The Five Biggest Mistakes New Amazon Sellers Make & How to Avoid Them – How to Sell on Amazon for Beginners

Selling on Amazon is an amazing opportunity for those looking to begin making a passive and residual income whether to augment their current salary or to pursue full-time, particularly with Amazon FBA (Fulfillment by Amazon). In fact there has never been a better time to begin for several reasons including:

E-commerce is still less than 12% of all commerce believe it or not and growing every year.

Next year e-commerce is projected to be 15% of all commerce and five years from now it’s projected to be 30% of all commerce. So we are still in the early stages!

Amazon is already bigger than than the next ten biggest ecommerce platforms combined and yet e-commerce is still in its infancy!

Mobile commerce is projected to grow by 300%+ between 2014-2018.

Amazon is by far the largest and easiest way for people to purchase goods by mobile

With such a fantastic opportunity available it is no surprise so many people are looking to jump in and learn how to create their own successful Amazon business by learning how to sell on Amazon. Unfortunately many struggle as they lack the experience and know-how to avoid the most common mistakes those before them have made. We at AMZ Insiders have experience building a business from scratch to over $500K in one year and to over $60 million per year currently and we’ve provided coaching to hundreds of students in support of helping them do the same. So here are our top five mistakes to avoid!

1) Not Researching Your Product Choice Appropriately

When you begin an Amazon business it is both an exciting and a nervous feeling. Many people find a product they are excited about (most use to do so), get some basic information such as the price, minimum order quantity, shipping cost, order a sample, and place their first order. While it’s exciting to have your first order placed and on the way, it is pure gambling if you have not done all of the needed research on the front-end before. We use www.AMZProductSpotter.com as our primary research & analysis tool (we use the Chrome Extension extensively and the web app periodically) for all of our initial and ongoing research.

We then apply specific criteria to evaluate how well the product sells, the level of competition we will face, whether we can achieve sufficient profit (given all-in costs vs. what we can sell it for) and our ability to source a high quality product that meets or exceeds our standards. If you get the product selection correct (and there are a vast number of products that are “correct”) everything else is much much easier. If you get the product selection wrong everything else is much more difficult. We invest a lot of time on our front-end product analysis as the financial payoff of “getting it right” is huge.

2) Choosing a Brand Name Without Making Sure it is Not Already Trademarked

When you sell on Amazon you can “Private Label” your product by putting your own brand name on the item you order from China (there are other places to source from but China is by far the most common location). It’s kind of a fun process to come up with a name that becomes your “very own”. Often people spend way too much time trying to find the perfect brand name and creating the perfect logo. What is extremely important is to make sure whatever name you choose is not already in-use and trademarked by someone else.

This is one of those “Amazon life lessons” we learned the hard way! We had two products selling like crazy for a brand name we had selected. The brand name we chose was not trademarked but we decided to shorten the name on our product as we liked the way it looked. We didn’t think anything of it until a few months later Amazon blocked both of the listings (and all of our variations) without any notice after the trademark holder reached out to Amazon. We had to recall all of our inventory, create a new listing, re-label each item, and send back in to Amazon. This was a huge pain in the a$$ and you definitely do not want to replicate our mistake.

You can research trademark information at www.USPTO.gov as well do searches on Amazon, Google, and elsewhere to ensure you are in the clear. The brand name you pick is not what will make your product sell well but ensuring you pick a brand name that is not in conflict with anyone else’s brand is of huge importance. So make sure you are good-to-go with the name you choose. Eventually you will want to trademark your brand name and this will yield other benefits such as being approved as part of Amazon’s “Brand Registry”.

3) Launching a New Product Without a Launch Strategy in Place For Your First Thirty Days

When your product is live on Amazon and available for sale the “clock is ticking”. Keep in mind, hope is not a strategy! You need to have a plan and you need to execute that plan. Amazon is trying to project how much customers are demanding your product. This being the case it is critical that you prove to Amazon’s algorithm that your product is in-demand and that Amazon should present your product before others when customers are searching for keywords related to your product.

To accomplish this it’s important that you view a sizeable portion of your initial inventory as an investment towards future sales on future re-orders that you will largely giveaway initially (or close to giveaway with 90%+ discount). To give our products away we use which allows you to offer vouchers to their buyer’s club partner who are interested in receiving your product at a discount. These giveaways will help improve your BSR (Best Seller Rank) and will also help drive some initial reviews of your products (having quality reviews is important to instill confidence in prospective customers choosing your product over your competitors).

It is important to have an aggressive marketing plan in place from the get-go. You also must know how to make effective use of Amazon’s Campaign Manager to drive initial sales and identify important keywords. There are several other additional tactics that separate those that get tremendous traction vs. those that wonder why their products don’t seem to be selling. So ensure you are a savvy student of all the various ways to drive traffic both within Amazon and off-Amazon to your listing.

4) Failing to Manage Your Keyword Rankings on a Consistent Basis

Keyword ranking success is absolutely critical to achieving strong sales. When people go to Amazon they typically enter a product search term for what they are looking for and then make a choice among the products that show up on the first page for what their search. Often students will say words to the effect, “I’m ranking on page one and I’m hardly getting any sales. Why?” My response is it’s important to realize that “page one ranking” is not about one keyword! It’s about ranking successfully for as many keywords as possible.

To track all of our keywords, their rankings, and how they are trending over time we use www.AMZInsidersTracker.com as well (same tool as we use to manage our voucher giveaways). Just because you rank on page one for one keyword means very little. That keyword may have a low search volume and/or there may be many other keywords that people search for to find your type of product. You have to view this as a competition or “battle” on many fronts where each keyword is essentially it’s own “battle” and you are competing to get to the top for numerous keywords. If you can get to the top in enough keywords that matter (those with sufficient search volume) you will “win the war” and you will have very strong sales.

Additionally, you need to be continuously on the lookout for new keywords. At times we’ve found new keywords months later that we didn’t realize initially were relevant to our product. When you find these keywords it’s like find a new goldmine for which you can begin mining!

5) Thinking This Does Not Require Work and That You Won’t Need to Learn from Others

Selling on Amazon FBA gives you an amazingly powerful opportunity but only if you are willing to put in the work and are consistently looking to learn from others that already know a proven replicable process. The beauty of this business is that you can put in as much time towards it as you wish. It is completely up to you. That being said, you have to be willing to take action and push your business forward just like any other business owner. The more you provide “water and nourishment” by following a successful proven process the more you will see your business flourish.

Additionally, you need to find those that have done this successfully before and look to replicate their progress. We believe strongly that just like every olympic athlete needs a coach in order to reach peak performance, so does each and every Amazon business owner. The reason we were so successful so quickly is we found Amazon selling experts who already had established successful processes. We replicated what they taught us, “made it our own”, and then continued to implement what we learn each and everyday. Eventually everyone can “figure out the answer” but to be successful it matters how quickly you can figure out the answers relative to the competition.

Be sure to keep each of these five mistakes in mind and learn from the many that have made these mistakes before you!

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